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Carbon nanotubes (CNT) have been shown to penetrate and accumulate in the deep lung tissues after in vivo pulmonary exposure. This raises a major concern of long-term adverse health effects, particularly carcinogenesis due to their structural similarity to asbestos, a known human carcinogen. However, there is neither clear knowledge nor a practical method to assess this carcinogenic potential. In this study, we developed a chronic exposure model using human lung epithelial cells to address this knowledge gap. We conducted subchronic exposures of dispersed single-walled CNT (D-SWCNT), multi-walled CNT (D-MWCNT) and crocidolite asbestos (ASB) to human small airway epithelial cells (SAEC) in culture. Ultrafine carbon black (D-UFCB) and dispersant-only exposed cells (DISP) served as negative controls. SAEC were exposed to 0.02 µg/cm2 of the particles for 25 weeks and evaluated for cancer cell phenotypes. Next, mRNA samples from the exposed cells were subjected to whole genome microarray and rtPCR analyses for toxicogenomic evaluation. Differentially expressed genes were uploaded to Ingenuity Pathway Analysis to identify gene targets and molecular mechanisms of neoplastic transformation. Our results showed that both D-SWCNT and D-MWCNT-treated cells exhibited typical malignant transformation properties, such as increased proliferation, migration, invasion, anchorage-independent cell growth and angiogenesis compared to controls. Both D-SWCNT and D-MWCNT cells expressed significant changes in genes associated with cell death, movement, proliferation and cancer. Top ranked pathway along with Western blot analyses identified several altered signaling pathways and transcription factors associated with oncogenesis. These results indicate that long-term low-dose exposure of human lung epithelial cells to D-SWCNT and D-MWCNT induced neoplastic transformation of the cells which suggests potential carcinogenicity of the nanoparticles. The described cell model system could potentially be used as an in vitro predictive screening test for potential carcinogenicity of other nanomaterials. Phenotypic anchoring of toxicogenomic response to neoplastic cell transformation following in vitro subchronic nanomaterial exposure can potentially serve to identify novel mechanisms of action and facilitate human cancer risk assessment.